Space International

CHINA’S weight in the global economy means that it commands the world’s attention. When its industrial production, house building and electricity output slow sharply, as they did in the year to April, the news weighs on global stockmarkets and commodity prices. When its central bank eases monetary policy, as it did this month, it creates almost as big a stir as a decision by America’s Federal Reserve. And when China’s prime minister, Wen Jiabao, stresses the need to maintain growth, as he did last weekend, his words carry more weight with the markets than similar homages to growth from Europe’s leaders. No previous industrial revolution has been so widely watched….

(…) Unlike the tigers, China relies very little on foreign borrowing. Its growth is financed from resources extracted from its own population, not from fickle foreigners free to flee, as happened in South-East Asia (and is happening again in parts of the euro zone). China’s saving rate, at 51% of GDP, is even higher than its investment rate. And the repressive state-dominated financial system those savings are kept in is actually well placed to deal with repayment delays and defaults.

Most obviously, China’s banks are highly liquid. Their deposit-taking more than matches their loan-making, and they keep a fifth of their deposits in reserve at the central bank. That gives the banks some scope to roll over troublesome loans that may be repaid at a later date, or written off at a more convenient time. But there is also the backstop of the central government, which has formal debts amounting to only about 25% of GDP. Local-government debts might double that proportion, but China plainly has enough fiscal space to recapitalise any bank threatened with insolvency.

That space also gives the government room to stimulate growth again, should exports to Europe fall off a cliff. China’s government spent a lot on infrastructure when the credit crunch struck its customers in the West. But there is no shortage of other things it could finance. It could redouble its efforts to expand rural health care, for example. China still has only one family doctor for every 22,000 people. If ordinary Chinese knew that their health would be looked after in their old age, they would save less and spend more. Household consumption accounts for little more than a third of the economy.

China and the U.S. are often portrayed as struggling for influence around the world. But to look at it this way is to risk a self-fulfilling prophecy, as this view implies that international relations are a zero-sum game and are, in fact, about being “either with or against” one or the other. European countries do, for instance, have quite elaborate contacts with Beijing – and the U.S. does not see that as a power struggle about influence there.

African states are enjoying the liberty to broaden the scope of their external relations, going beyond the limitations that the U.S.-Soviet cold war inflicted on them. This has several aspects: First, it is comforting to be in demand by numerous partners and to see some more options beyond the previously marginalized position. Second, it gives additional choices and makes international relations more complex, but also more flexible. Third, most African states do not want to throw themselves at either the U.S. or China, but want to be members of the international community with diversified foreign relations.

Thus, to avoid a U.S.-China “cold war,” we should ensure that African states do not face an either-or choice. The development toward a more multipolar world is a fact of life, with not only China but also India, Brazil, Indonesia, South Africa and others playing an increasingly important role in their regions and globally. This might be making the world a less predictable place, as there is more than one or two actors to consider. But it is the world beyond the cold war. We should engage constructively with it — and leave African states their choices in this world.

There shouldn’t need to be a debate about whether China should provide economic aid and technical assistance to other countries. Yet voices have been raised in recent years decrying China’s foreign aid as an unnecessary face-saving project that it cannot afford. These naysayers argue that China is still a developing country with a large poverty stricken population and can’t afford to give aid on such a large scale, and that aid is not an effective way to develop diplomatic relations as some recipient countries have turned against China.

But such arguments are false. Aside from humanitarian reasons, foreign aid to other countries is necessary for the survival and development of China. This can clearly be seen if we take the historical background into account.

Foreign aid played an irreplaceable role in helping China to break the trade embargos imposed by both the Western and Eastern blocs soon after the People’s Republic of China was founded. It enabled the country to make friends and deepened mutual understanding with many other developing countries and their people…

China is now the world’s second-biggest film market after America. It has a booming home-grown film industry, making historical dramas and romantic comedies, but foreign blockbusters are the big money-earners. Although most films are pirated on release and viewed online and on dodgy DVDs, the rising middle classes are increasingly willing to fork out for a night at the cinema. Last year China’s box-office take rose by more than 30%, to over $2 billion, according to the Motion Picture Association of America. The number of cinema screens in China has doubled in five years, to nearly 11,000—again, second only to America. China’s box-office revenues may overtake America’s by 2020.

Yet China will not grant Hollywood the access it desires. Until recently only 20 foreign films could be screened at Chinese cinemas each year. In February the number increased to 34—though only if the extra 14 are shown in 3D or large format.

There is an easy solution to this problem: Hire local reporters. One notable exception to the history of poor coverage of Africa is the BBC, whose World Service has long maintained correspondents in most of the continent’s capital cities. Although the World Service’s budget has been slashed repeatedly due to declining government support, the BBC has managed to keep much of its Africa coverage afloat by relying largely on local reporters to get the story. This has been particularly important in Somalia. For two decades, it has been nearly impossible for Western reporters to fully and freely report from Somalia due to safety concerns, but the BBC Somali Service’s team of local correspondents and producers do an excellent job of getting the news out from their own country. There’s no reason that other major media providers couldn’t hire local reporters to improve their coverage as well. Rather than relegating them to second-tier or co-author status, why not hire Africans as country or regional correspondents? A reporter does not have to be Caucasian to provide objective and well-written reporting from the continent, and in many cases, this reporting is more nuanced than that of an international correspondent who spends five days reporting a story. For example, by far the most thoughtful reporting and analysis on Ugandan reactions to the Kony 2012 viral video came not from American journalists, but from Ugandan reporter Angelo Izama who, to the New York Times’ credit, was able to publish an opinion article in its pages. Why can’t the Times hire Izama or someone equally qualified to report on Uganda full time?

While western nations are reluctant to open up trade with Africa and prefer to support the Continent by donating money to poor countries, the Chinese have taken a different approach. There is an old Chinese saying that goes: “Give a man a fish, you feed him for a day. Teach a man to fish, you feed him for life.” China is living up to that mantra and has dominated Africa in every aspect.

The West is baffled as to how deeply embedded China’s tentacles have become in Africa, in such a short period of time. The Chinese have succeeded in investing in Africa’s infrastructure and are also training African workers to prepare them for the job market. This approach has yielded trust between native Africans and the Chinese, because Africans do not view Chinese as attempting to recolonize them.

The West on the other hand is not trusted by native Africans. Every move is second-guessed. Every donation is looked at suspiciously with the recipients wondering when the strings attached to each donation will be pulled. The Chinese have refrained from sending any military-related assistance to the Continent…